Containing Iran’s Influence in Iraq: Choices and Consequences for Washington

U.S. President Donald Trump’s public rejection of veteran Iraqi politician and Dawa Party leader Nouri al-Maliki’s bid to return to the premiership has reopened a central question about Washington’s objectives in Iraq: is the United States seeking to curtail any meaningful role for pro-Iran Shia groups in the next government, or is it primarily aiming to block a narrow set of controversial figures from occupying the highest executive office? In a 27 January post on his Truth Social platform, Trump warned that if Maliki were to become prime minister, the United States would cease its support for Iraq altogether due to Maliki’s track record as a former two-term prime minister from 2006 to 2014. The unusually blunt intervention underscored a renewed U.S. willingness to shape political outcomes in Baghdad—at a moment when tensions between Washington and Tehran are once again intensifying.

Importantly, U.S. interest in influencing Iraq’s post-election political configuration appears to extend well beyond the premiership. Foreign Minister Fuad Hussein suggested in November that the United States conveyed a list of six armed factions that should be barred from joining the government, though he did not name the groups. While U.S. officials have not publicly confirmed the existence of a formal list of groups to be excluded, U.S. Embassy Chargé d’Affaires in Baghdad Joshua Harris said in mid-December that Washington does not accept the participation of armed groups in the next government. The reported appointment of Tom Barrack—whose portfolio includes Turkey, Syria, and Lebanon—as special envoy for Iraq appears to signal Washington’s intent to more actively shape developments in Iraq. It also suggests a ratcheting up of pressure on pro-Iran armed groups, given Barrack’s parallel efforts to bring the Syrian Democratic Forces under Damascus’s control and Hezbollah under the authority of the Lebanese state.

The question of armed factions’ role and participation has become more difficult to avoid following the strong electoral showing of parties linked to major armed factions—including Asa’ib Ahl al-Haq , the Badr Organization, Kata’ib Hezbollah, Kata’ib Imam Ali, and Kata’ib Sayyid al-Shuhada—which together won around 80 of the 329 parliamentary seats. Their parliamentary weight makes some level of executive representation likely and raises the risk that armed actors could further institutionalize their influence through ministries and the use of state resources. Among these group, Asa’ib Ahl al-Haq has succeeded in securing the first deputy speakership of parliament so far.

For years, U.S. policy has rhetorically opposed the expanding role of pro-Iran armed factions in Iraq’s political system. Since last October, however, that rhetoric has sharpened noticeably as Secretary of State Marco Rubio called on Iraq to “disarm… Iran-backed militias.”

Against this backdrop, some Iraqi media reports have floated the possibility of a U.S. recalibration rather than an outright ban—one that would tolerate militia-linked participation in parliament and public service-centered ministries such as Health or Labor and Social Affairs—while drawing red lines around powerful “sovereign” ministries such as Defense, Foreign Affairs, Interior, Finance, and Oil. Others have argued that Washington may tolerate a parliamentary role for armed factions while opposing their participation in the executive branch, pointing to Asa’ib’s acquisition of the first deputy speakership as evidence of this logic and as an attempt to reduce the risk of a direct confrontation with the United States. U.S. officials have not confirmed any such distinction—whether between service and sovereign ministries or between parliamentary and executive roles—but the persistence of this speculation underscores growing uncertainty over where Washington intends to draw its red lines and how forcefully it is prepared to enforce them.

The Cost of Inaction

The presence of pro-Iran armed groups within Iraq’s official state structures has long predated the current situation. Since the formation of the post-2003 order, armed actors have maintained political footholds, initially through groups such as the Supreme Islamic Council of Iraq and its Badr Brigades. This trend accelerated sharply after the 2018 parliamentary elections that followed the defeat of the Islamic State of Iraq and the Levant (ISIL) terrorist organization. The outgoing government is itself a product of this evolution, emerging from the Coordination Framework—a Shia umbrella coalition that brought together major armed factions alongside other traditional and more moderate Shia parties, including Nouri al-Maliki’s Dawa Party, Ammar al-Hakim’s Wisdom Movement, and former Prime Minister Haider al-Abadi’s Victory Coalition. Today, the Framework controls roughly 180 of the 329 parliamentary seats, including those held by the Reconstruction and Development Alliance of incumbent Prime Minister Sudani.

Over the past three years, the absence of the Patriotic Shia Movement led by Muqtada al-Sadr has further reshaped the political landscape. Sadr’s withdrawal removed the principal Shia counterweight to Iran-aligned armed factions, enabling them to consolidate power through wide-ranging institutional capture, expanding their presence and influence over political, security, economic, and cultural domains. With their strong showing in the November parliamentary elections, these groups are positioned to deepen their penetration of the Iraqi state and society, translating electoral gains into expanded patronage networks that function as the core mechanisms of power, influence, and resource distribution in Iraq’s political system, except if Washington intervenes to prevent that.

Washington’s Options

Since taking office, the Trump administration has adopted an increasingly aggressive posture toward Iran-backed armed factions in Iraq, reflecting the growing alignment between the United States’ Iraq policy and its broader Iran strategy. This relationship is underscored by Trump’s direct social media warning, reinforcing the administration’s hardline approach. Given the depth of Iranian penetration into Iraq’s political, security, and economic spheres, Washington has treated Iraq less as a discrete arena than as an extension of its campaign to constrain Tehran’s regional influence. When the administration restored “maximum pressure” on Iran in February, it explicitly identified neutralizing Iran’s regional “terrorist network” as a core objective.

This shift was accompanied by tangible punitive measures. In September, the U.S. State Department designated four additional Iraqi armed factions—Harakat al-Nujaba, Kata’ib Sayyid al-Shuhada, Harakat Ansar Allah al-Awfiya, and Kata’ib al-Imam Ali—as Foreign Terrorist Organizations, adding to earlier designations such as Asa’ib Ahl al-Haq and Kata’ib Hezbollah. In October, the Treasury Department sanctioned the Muhandis General Company, an economic conglomerate operating under the Popular Mobilization Forces (PMF), alongside financial networks affiliated with Iran’s Islamic Revolutionary Guard Corps, citing the diversion of Iraqi government contract funds to the PMF and the facilitation of money laundering on Iran’s behalf. The PMF, established as an official state security body in 2014, remains the institutional channel through which these factions access state funding and weapons, and acquire legal legitimacy, while simultaneously receiving specialized Iranian weaponry, including drones and missiles, that fall outside the Iraqi state’s known arsenal.

Against this backdrop, Washington faces a set of strategic options for dealing with these Iran-backed organizations’ entrenched role in Iraq’s political order. Broadly, three paths emerge, each carrying distinct risks and trade-offs. The options laid out below assume that the regime in Tehran would continue to survive even after another round of U.S.-Israeli strikes. If the Iranian regime were to fall, a completely new reality will take hold in Iraq.

Aggressive Confrontation

Taken at face value, the administration’s escalating rhetoric and expanding sanctions regime points toward a more coercive trajectory. In this scenario, Washington would intensify pressure through additional designations, sanctions, and financial restrictions targeting armed factions, their leadership, and their economic ecosystems—particularly networks facilitating sanctions evasion for Tehran. Such a strategy might also aim to force the exclusion of these groups from government formation and could extend to dismantling the PMF as an institutional umbrella. If Iran-aligned factions continued to dominate the Iraqi government, Washington might expand punitive measures to encompass key sectors of the Iraqi economy and state institutions beyond the PMF, potentially triggering a bilateral crisis unseen since the Saddam Hussein era. In extreme circumstances, confrontation could escalate to kinetic action, including U.S. strikes—or potentially Israeli strikes—against militia targets, particularly in response to attacks on U.S. personnel, whether or not these occur in the context of a possible renewed Iran–Israel conflict. Under such. Scenario, the U.S. would also actively veto any prime ministerial candidate seen as having links with Iran.

Resigned Accommodation

Under this scenario, Washington would tacitly accept the deepening entrenchment of pro-Iran factions within Iraq’s state and societal structures, effectively agreeing to an off-the-books form of geopolitical power-sharing agreement with Iran inside Iraq. Given its major regional and global priorities—from managing the situation in Gaza to maintaining stability in Syria and the strategic global competition with China—Washington has limited political bandwidth and resources for sustained confrontation with Iran and its regional proxy network. Yet accommodation would risk legitimizing militia-driven state capture and eroding U.S. credibility in Iraq and across a region increasingly resentful of Iran’s proxy network.

Middle-ground Containment Strategy

This approach would combine continued engagement with the Iraqi government and political system with sustained, targeted pressure on militia networks, primarily through economic and financial tools. Rather than seeking wholesale exclusion or dismantlement, Washington might focus on limiting the armed factions’ most destabilizing behaviors and constraining their regional activities. This strategy would largely reflect continuity with recent U.S. practice: neither dramatic escalation nor passive acceptance. Within this framework, Washington might tolerate the participation of militia-affiliated figures—or “civilian” figures adjacent to them—in government, particularly in public service-oriented ministries, while seeking to block their access to sovereign portfolios such as defense, interior, finance, or oil.

None of these options come without a cost. First, since 2018, the steady integration and institutional capture of the Iraqi state by Iran-aligned armed factions has fundamentally reshaped governance, with each electoral cycle further entrenching their position. Secondly, following Damascus’s recent military campaign against the SDF in Syria and the reported escape of ISIS prisoners, the strategic importance of retaining the PMF as a force capable of confronting a potential jihadist resurgence is likely to grow in Iraq—not only among Shia actors, but also among Kurds and other communities. The dilemma Washington faces is whether it could meaningfully constrain the pro-Iran groups—and at what cost to U.S. interests and Iraq’s fragile political order.

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of Gulf International Forum.